Jakarta (Antara News/Asia Pulse) - Indonesia's macro economy is likely to expand by six per cent in 2007, with the real estate sector showing signs of a revival and the nation's banks recording increases in lending, an observer said on Tuesday.

The expected growth rate of six per cent is below the govenment's target of 6.2 per cent however, as a number of factors, including a decline in new construction projects, have hampered growth, said Fauzi Ichsan, an economic analyst from the Standard Chartered Bank.

If such hurdles can be overcome, economic conditions will improve he said, adding that the country's micro economic problems had not been handled well in the past.